New Delhi: Coal India Ltd has offered deferred payment facility to both power and non-power consumers to provide relief and help improve their liquidity during the lockdown imposed by the government to contain coronavirus infection.

The move has come at a time when reports suggest that power demand has declined due to the nationwide lockdown hitting cash flows of electricity distribution as well as generation companies.

"In order to provide relief to the power sector consumers and increase liquidity in the system, CIL has already allowed the facility of Usance Letter of Credit to power sector consumers for payment of coal instead of cash advance for the Fuel Supply Agreements (FSA)," the Coal Ministry said in a release on Thursday.

Representational image. Reuters

Usance Letter of Credit or deferred payment letter of credit is payable at a predetermined future date.